Fashion's queen of green

By Rachel Wells

March 14, 2010 — 12.00am

The word towards the end of last year was that Lisa Gorman - the woman responsible for making green fashion fashionable - was cash-strapped and struggling. Gloomier predictions even had her eponymous label on its last legs.

As word spread that Gorman had sold part of her decade-old business to Factory X - the company behind brands including Alannah Hill, Jack London, Dangerfield, Revival and Princess Highway - the nation’s rag trade speculated that she had become the latest victim of the economic downturn.

"She was going broke. Had to sell her business," a retailer who claimed to be a friend of Gorman’s told me matter-of-factly when I visited his store.

But that’s not the way Australia’s most famous eco-conscious fashion designer sees it. Yes, she sold a share of the business. But she denies she was ever "going broke".

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Rather, the 38-year-old, who launched her womenswear label in 1999 and has championed green fashion since she launched her first organic collection in 2007, says the decision to fi nd an investment partner was about sharing the risk and responsibility.

"Primarily it was about sharing the responsibility both financially and mentally. I had just had another baby. So there was a lot going on and I wanted to make sure that I didn’t kill what I had in the business," Gorman says.

"My natural calling is to product and design, and you can't create if you’re under the level of stress that you can often be under when you’re trying to deal with running a business that size, with eight stores (now 10 nationally) and 75 staff ... I couldn't take the business any further than where it was. It just would’ve been more detrimental than good."

When asked if she needed a business-saving cash injection, she responds forthrightly: "Well, we had two more stores coming on, and you know, it’s always good to have extra cash there. But it wasn’t urgent. That (the money) was second to me wanting to relieve myself of 100 per cent of the business decisions. I was scared that if I kept doing that, I would kill the business."

Basically, Gorman felt she needed help to run the business, given its vast growth since the former nurse started making clothes "on the side" in 1998.

"I had got to the point where I spent more time sitting in interviews and in fi nancial meetings than I did designing, and that’s no good. And the other thing we lacked was an understanding of business with regards to things like stock levels and the sort of stuff you don’t know unless you’ve had larger businesses," Gorman explains in the newly renovated 1860s stone villa she shares with her partner, furniture dealer Dean Angelucci, and her daughters, Hazel, 1, and Pepa, 3.

The family moved to Fitzroy just a week before Gorman moved to the Factory X headquarters in Abbotsford.

"It was a crazy time. We were still living over in Prahran while we were renovating this place and Hazel was just a newborn. It was the most intense period of my life. I was like, now I remember why I didn’t want to start this business in the first place."

Gorman has always been more comfortable in the design room than the boardroom.

"The thing is I never planned to start Gorman. In fact, I was scared of business. It was very unfamiliar to me ... It justkind of happened."

After completing her secondary education in Warrnambool, Gorman moved to Melbourne in 1990 to study nursing. When she started her training, she says, she never thought she would actually complete it.

"I’ve always loved making clothes. From the moment I could handle the sewing machine, from about five years old, that’s all I did. That’s all I wanted to do. My three sisters and I would set up Barbie runways and I was always the creative director in the household.

"I remember telling my careers counsellor that I wanted to get into fashion design, but trying to get information about where and how to do that down in Warrnambool back in the ’80s was quite hard … and I guess my upbringing did have a sensibility whereby no one kind of did anything left of centre. There were no other designers in the family. They all worked in health or administration. So becoming a fashion designer always felt more like a great dream than a viable career option."

Instead, Gorman followed her father (a nurse, and later, a director of nursing) and mother (health administration) into the health system.

Despite her expectations, Gorman did finish her training and worked for a year in the renal transplant unit and then the intensive care unit at the Royal Melbourne Hospital before heading overseas to travel for a year.

"When I came back I just knew I wanted to do something new and although I didn’t realise just how intensely, my heart still lay in the fashion industry ... I’d only been back two days and I saw an ad for a retail sales trainee in the window at Mariana Hardwick. I applied immediately."

Within a couple of years, Gorman was given an opportunity to design for Hardwick - one of Melbourne’s leading bridal designers.

"I learnt so much there because it was all bridal and evening wear. I learned the fundamentals of construction, and corsetry is as complicated as it gets ... It’s so ironic really because Gorman is the complete opposite to what I did at Mariana’s."

After a couple of years working with Hardwick, Gorman moved to New York for two years where she took odd jobs. In 1998, she returned to Melbourne, where she nursed part-time and also worked with Hardwick part-time. She was then approached by friends Rachael Cotra and Kym Purtell - owners of the Fat boutiques that specialise in independent Australian fashion - to design some clothes for their first store, in Brunswick Street, Fitzroy.

"It was slow and steady to begin with but then I got to a point where I had around 18 wholesale accounts and it was starting to make a bit of money, and so I thought, well, I guess I do have a business on my hands, as much as I denied it, because as I said, I was scared of business. I didn’t know anything about it."

In 1999, Gorman officially registered her business and focused on her label full-time. In 2004, she opened her first store in Chapel Street, Prahran, and also began selling in Myer.

In 2008, she defected to rival David Jones because she felt "they had a better understanding and offering of Australian designers".

In 2007, Gorman became one of the first fashion designers in Australia to launch an organic collection. Even now, there are just a handful of labels in Australia offering sustainable fashion.

For Gorman, a growing awareness of organic products and environmental issues piqued her interest in producing sustainable clothing.

"I’d started recycling at home and all those things and thought well, how can I be greener at work too?"

"When you talk about Lisa, you talk about the significant impact she’s had on bringing attention around organic clothing and sustainable practice.

"Up until then everything (in organic fashion) was neutral and natural and a bit hessian-like. And what Lisa was able to do was integrate really modern, contemporary fashion, quality design and still have the ethics aligned to it. That was the big thing from my perspective."

Over the next 12 months, Gorman plans to expand her organic range from 10 per cent of the collection to 20 per cent, and keep increasing that share each year.

The company is also looking to grow bio-fuel crops in Vietnam on contaminated land that cannot be used for agriculture. This will replace conventional oil to fuel parts of the Vietnamese factory where the majority of the Gorman product is made.

Gorman says she initially heard about organic fabrics from her Vietnamese manufacturers.

"Although it was quite a bit more expensive at the time I was like, well, now that I know about it I can’t not do it. It would be wrong."

But the organics range almost failed before it began.

"The thing I didn’t realise was that there was a big difference between buying organic food and buying organic clothing. People were less inclined to buy into organic clothing because it wasn’t physically benefi ting them. The benefi t of using organic cotton was purely for the earth, so it wasn’t as direct a personal interest and so people weren’t prepared to pay 30 per cent more for something."

Gorman had to drastically cut her margins to move the stock. Even now, her sustainable fashion range, which she says has since become viable thanks largely to a reduction in raw material costs, has a signifi cantly lower profit margin than the main Gorman collection.

"If I had investment partners at that time it may never have taken off because there were losses in the first year because of the organic collection ... It really only survived because I was so passionate about making it work."

She still is. Gorman says that when it came time to look for an investment partner for the business, finding someone who was willing to continue the less profi table sustainable range was paramount.

As it turned out, that was Factory X. In a statement, the company’s media-shy managing director, David Heeney, said: "Factory X is structured around creating support for designers to gain equity without the exposure of running their own businesses. We let the designer do the creative without the stress of the rest. Gorman presented as an ideal fit into our stable of eight other brands. We are extremely happy with the results and are always seeking more suitable partners."

Eight months since Gorman entered into a partnership with Factory X (neither party will disclose what percentage of the business it owns) and gained a signifi cant capital injection, she says she has no grand expansion plans. Rather, the change will allow her to create more products for her customers.

"Gorman is not going to be the next 50-store chain. We very much want to maintain the Gorman aesthetic and product in its current form.

"Investment partners can offer you that (expansion) opportunity but the other thing they can offer, in my case, has been the opportunity to focus on design and product and creative direction."

Gorman says her renewed focus on design means customers are getting more garments, more often.

"It’s been eight months now, and I can see that the business is defi nitely benefi ting from it, and so am I, personally. It’s been a good move. Before the partnership, I was exhausted. But I love it again now. It’s like a new phase for me. I feel so much more in tune with the product again and excited, and it’s just so much more of a joy to go into work. I feel like a huge weight has been lifted."